Is Laboratory Corp. of America Holdings overvalued or undervalued?

As of 25 July 2025, the valuation grade for Laboratory Corp. of America Holdings moved from expensive to very expensive, indicating a significant shift in its perceived value. The company appears overvalued based on its current metrics, including a P/E ratio of 28, a Price to Book Value of 2.56, and an EV to EBITDA of 14.82. In comparison, peers such as Quest Diagnostics, Inc. have a P/E of 27.82 and an EV to EBITDA of 17.12, while IQVIA Holdings, Inc. shows a higher P/E of 36.39, suggesting that Laboratory Corp. is relatively less expensive than IQVIA but still on the higher end of the valuation spectrum.
Despite a strong year-to-date return of 20.86% compared to the S&P 500's 12.22%, the long-term performance shows a stark contrast, with a 3-year return of 44.03% versus the S&P's 70.41% and a 5-year return of 75.91% compared to 96.61%. This indicates that while the stock has performed well recently, its valuation may not be justified in light of its peers and the broader market trends.